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Colombia's consumer prices rise 1.66% in Feb
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Brazil's Azul gains on upbeat outlook
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Chile's Costa sees more time for inflation to reach target
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Inflation data from Brazil, Mexico, Chile due this week
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Latam FX up 0.7%, stocks up 0.8%
(New throughout, updates prices, market activity and comments)
By Amruta Khandekar and Ankika Biswas
March 6 (Reuters) - Latin American currencies gained
steam against a softer dollar on Monday, the eve of Federal
Reserve Chair Jerome Powell's testimony which investors will
watch for clues on future U.S. rate hikes, with Colombia's peso
rising for the fourth straight session.
MSCI's index for Latam currencies was up
0.7% by 2014 GMT while the broader EM currencies gauge was flat.
Powell is set to testify before Congress on Tuesday and
Wednesday. Investors will watch for clues on monetary policy
plans. In February, concern that U.S. interest rates would stay
higher for longer hurt risk sentiment.
Recent commentary from other Fed officials has calmed
jitters, with markets now pricing in three 25-basis-point rate
hikes.
"We are moving towards an expectation for tighter rates,"
said Cristian Maggio, head of portfolio strategy at TD
Securities.
"There could be a risk that (Powell's) rhetoric will push
interest rates to the upside."
The Chilean peso was up 0.7%, with central bank Chief
Rosanna Costa highlighting that rising consumer prices have not
yet reached the target, further tempering expectations of
interest rate cuts.
The Colombian peso rose 1.7% against the dollar to hit a
one-month high.
Colombia's consumer prices rose 1.66% in February, the
country's DANE statistics agency announced on Saturday, taking
cumulative 12-month price growth to 13.28%.
The Brazilian real was flat, while Mexico's peso slipped 0.3% from five-year highs touched in the previous
session driven by a widening rate differential between Banxico
and the Fed.
The Chilean peso rose 0.7% against the greenback.
Argentina's Economy Minister Sergio Massa said the country
is launching a voluntary swap program of domestic debt, aimed to
"give predictability" to the market with "allied banks" to
improve access to credit.
Investors await inflation data from Chile, Brazil and Mexico
this week as they try to gauge how close central banks in the
region are to ending their tightening cycle.
Latam stocks were up 0.8%, with Argentina's
Merval index rising 2.7%.
The inflation rate in Argentina is seen hitting 99.9% in
2023, speeding up from last year's rate and topping previous
estimates which saw a slightly slower rise, according to a
central bank poll of analysts released Friday.
Brazil's Bovespa edged 0.8% higher, boosted by an 40.8% advance in Azul SA after the airline projected positive cash flow in 2024 and beyond. Mining stocks like Vale SA fell tracking lower metal prices after China set a modest target for economic growth this year of around 5%.
Shares of Azul's peer Gol Linhas Aereas Inteligentes SA also jumped 24.2%. Key Latin American stock indexes and currencies at 2014 GMT:
Stock indexes Latest Daily %
change
MSCI Emerging Markets 993.53 0.56 MSCI LatAm 2233.07 0.8
Brazil Bovespa 104770.67 0.87
Mexico IPC 53955.40 -0.42
Chile IPSA 5427.52 -0.22 Argentina MerVal 252470.50 2.687
Colombia COLCAP 1225.17 0.87 Currencies Latest Daily %
change
Brazil real 5.1654 0.07
Mexico peso 18.0072 -0.36
Chile peso 797.8 0.73
Colombia peso 4702.25 1.75
Peru sol 3.77 0.03
Argentina peso (interbank) 199.3400 -0.53 Argentina peso (parallel) 368 1.90 (Reporting by Amruta Khandekar; Editing by Emelia
Sithole-Matarise and David Gregorio)
